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ESBA Bulletin of 15 May 2017

15 May 2017
by ESBA -- last modified 15 May 2017

EU/Digital Single Market: Commission reviews the state of play of the 2015 Digital Single Market strategy


HEADLINES

EU/Digital Single Market: Commission reviews the state of play of the 2015 Digital Single Market strategy

On 10 May 2017, the Commission published its Mid-term Review on the Digital Single Market (DSM). ESBA welcomes this and sees the mid-term review as an opportunity to offer additional SME-relevant input and bring the needs of SMEs to the foreground. In the past two years, the institutions have produced a high volume of legislative and regulatory output with a view to covering all facets of the DSM and moving towards its completion. While we recognise and support these efforts, and the stakeholder input that underpins them, we have our reservations as to the effectiveness and relevance of certain proposals. Moreover, we have concerns regarding the order in which interrelated proposals will most likely be introduced.

First and foremost, we would like to place emphasis on the proposal to address geo-blocking. This proposal was recently cleared of the committee stage in the European Parliament after IMCO adopted Rapporteur Thun's Report. ESBA maintains that the provisions relating to the applicable law, and how this can be determined in the context of so-called "passive sales", lack clarity and contribute to legal and commercial uncertainty. Moreover, confusion surrounds the provisions on post-sale services and obligations on the part of the seller. These short-comings have the potential to increase businesses' hesitation to sell online as well as to increase their compliance or even legal costs should they decide to do so. Obliging SMEs to sell before achieving the pre-requisite level of harmonisation elsewhere in the DSM is more likely to overburden them and decrease their competitiveness than to introduce them to a larger demand pool as claimed. We therefore call for substantive improvements on the geo-blocking proposal and a re-consideration of the time-frame for its introduction. As admitted in of the Commission's Review, the proposals on; digital contract rules, simpler VAT declaration procedures and affordable cross-border parcel delivery services can contribute towards eliminating the commercial pressures that cause geo-blocking. It is therefore of questionable logic that the proposal under consideration precedes those.

Secondly, we recognise the potential of online platforms in facilitating e-commerce and helping SMEs develop. Finding the right regulatory balance that levels the playing field and encourages fair competition is instrumental to achieving this twofold objective. We, much like the Commission's fact finding exercise, have identified platform-to-businesses (B2B) trading practices as an issue that requires further attention. We therefore call for increased transparency in platform-to-business contractual arrangements and terms & conditions for access. Moreover, we welcome the updated guidance on the Unfair Commercial Practices Directive which has the potential of better regulating certain platforms' gatekeeper role and their inherent conflict of interest when they compete with SMEs that they host. Moreover, non-personal data ownership and portability is subject to case-by-case contractual arrangements in the B2B context. Given the imbalance of bargaining power between large and small market participants, ESBA would like to echo the Commission's point for a clear framework for "access to non-personal data to foster fair and balanced access to, and use of, data." A systematic approach to data portability can increase legal certainty for SMEs when they engage with platforms and other business partners.

Finally, ESBA is in favour of any measure that can contribute to procedurally or substantively simplifying businesses' ability to establish an online or physical cross border presence. To this effect, we welcome the Commission's recent proposal for a single digital gateway which can help businesses reduce their administrative burdens when engaging in cross-border activities and bring the benefits of digitization to the process or establishing and running a business. The success of the gateway will lie in its ability to represent a true "one-stop-shop".

IN BRIEF

The European Business Summit is coming soon

On 22-23 May 2017, the European Business Summit will take place in Brussels. What will be the new geopolitical and trade strategy of the future EU-27? Can e-health and integrated care be a game-changer in healthcare systems? In cyber-security: what needs to be done with the collection and protection of data for businesses and customers? Is the EU Energy Union Governance able to address the challenge of finding a resilient, secure energy system and create green energy solutions? Just some of the issues participants of the European Business Summit will discuss with keynote speakers - including German Finance Minister Wolfgang Schäuble - in Brussels on 22-23 May. Register here and join the debate!

EU/Single Market: Commission adopts measures to strengthen the EU Single Market

On 2 May 2017, the European Commission published initiatives aimed at ensuring the use of commonly decided EU measures and facilitating the management of online paperwork by businesses and consumers. These objectives are laid out in 3 concrete measures: A Single Digital Gateway, A Single Market Information Tool (SMIT) and a SOLVIT Action Plan. The first aimed at setting up a single digital entry point that will help businesses and consumers to access online administrative procedures and assistance services. The second will enable the Commission, in some cases, to source specific data in cases of serious difficulties with the application of EU Single Market legislation. The Action Plan aims to increase the use of SOLVIT by increasing its accessibility by consumers and businesses.
For more information on the SOLVIT Action Plan, the SMIT and the Single Digital Gateway, please click here.

EU/VAT: Parliament Committee vote to decrease VAT for e-books

On 3 May 2017, the Parliament's Economic and Monetary Affairs Committee (ECON) voted on the report 'rates of value added tax applied to books, newspapers and periodicals'. This report aims at allowing Member States to charge a smaller rate of VAT on e-books, which would bring them into line with VAT charged on their printed counterpart. At present, e-books are taxed at an EU minimum standard rate of 15%, while Member States are free to charge a reduced rate from 5% to 0% on printed publications. Music and videos, as well as publications mainly containing music and video content, would continue to be taxed at the standard VAT rate.
For more information on VAT rates applicable in the EU Member States, please click here.

EU/Digital Single Market: The new Single Market Information Tool (SMIT)

On 2 May 2017, the European Commission unveiled a new proposal to strengthen its ability to have access to corporate data. The new Single Market Information Tool will further contribute to enforce EU single market rules in matter of transparency and fair competition. On the other hand, the private sector is concerned about the disclosure of sensitive business information. The Commission replied that the information provided would be treated confidentially, applying the same practices used in competition cases. The proposal follows the European Commission's difficulties in acquiring reliable data from car manufacturers about emissions.
You can find more information on the Single Market Information Tool (SMIT) here.

EU/Growth: Internal Market and Consumer Committee (IMCO) called the Commission to regulate the grey areas of Member States national laws

On 3 May 2017, the IMCO committee adopted a non-binding resolution regarding the EU Agenda for the collaborative economy. The Committee called upon the European Commission to regulate these grey areas where there are significant differences among Member States' legislation. The main targets of the proposed measures are to eliminate tax erosion and to ensure fair competition and workers' rights protection. Rapporteur Nicola Danti stated that the collaborative economy is a new phenomenon that brings to the EU new opportunities as well as new challenges. He called the Commission to pave the way for a harmonised and dynamic ecosystem.
For more information on the collaborative economy, please click here.

EU/Competition: Director General examined if e-commerce sites are in line with EU competition rules

On 10 May 2017, the European Commission published the final report on the e-commerce sector inquiry. Competition Commissioner Margrethe Vestager stated that the report revealed strategies used by companies in e-commerce markets that may restrict competition. Consequently, these strategies limit consumer choices and prevent lower prices online. Selective distribution, contractual restrictions and vertical integration of manufacturing and distribution activities were the areas of focus for the European Commission.
For more information on EU competition policy, please click here.

EU/copyright law: Strong opposition from MEPs over online platforms requirements

On 10 May 2017, numerous MEPs submitted amendments on the Commission's copyright law over online platforms. The main source of problems for this legislation is article 13. In its current shape, the proposal would oblige online platforms to check for any breaches of copyright law. The larger platforms would not be affected as much as smaller providers. Many MEPs fear that media-related SMEs and start-ups would have no technical and financial means to meet this requirement. They also pointed out that many copyright infringement come from illegal platforms and websites which would not be affected by the new legislation.
You can find more information on the new copyright law here.

PUBLICATIONS

CER: Brexiting Swiss-style: the best possible UK-EU trade deal

On 24 April 2017, the Centre for European Reform published a policy brief which seeks to outline a potential model for Brexit. The scenario is presented in a positive light as the best possible scenario for both parties and particularly for the UK. In shaping this best-case scenario, the policy brief takes into account both sides' "red lines" as they have been established thus far.
To access this publication, please click here.

Eurofound: Social Mobility in the EU

On 19 April 2017, Eurofound published a report on the social mobility of young people in the European Union. At first, the focus of the report is on intergenerational patterns of social mobility taking a comparative approach between this generation's potential of upward social mobility when compared to that of their parents. The focus then shifts to relative social mobility and explores the opportunities for individuals to move between occupational classes. Finally, the report looks at policy initiatives aimed at fostering social mobility and the visibility of social mobility initiatives in the current policy discourse of various Member States of the EU.
To access this publication, please click here.

CONSULTATIONS

Public consultation on whistle-blower protection

DEADLINE: 29/05/2017

The consultation will enable to collect information, views and experiences on the benefits and drawbacks of whistleblower protection; on the elements that are important for effective whistleblower protection; on problems arising both at national and EU level from gaps and weaknesses of existing whistleblower protection and from the divergences of protection across the EU, as well as on the need for minimum standards of protection.
To access this consultation, please click here.

Public consultation on the functioning of the administrative cooperation and fight against fraud in the field of VAT

DEADLINE: 31/05/2017

This public consultation aims at gathering views from stakeholder about their experiences with the current rules on administrative cooperation and fight against cross-border fraud in the field of VAT. The consultation also aims at collecting quantitative data on possible reduction or increase of regulatory costs/benefits for businesses especially SMEs. The results of the public consultation will be used to update the rules governing the administrative cooperation and the fight against cross border VAT fraud with a view to improve the functioning of the single market and tackling the heavy losses to the Member States and EU revenues.
To access this consultation, please click here.

Consultation: Review of the Significant Market Power (SMP) Guidelines

DEADLINE:26/06/2017

This public consultation aims at reviewing the SMP Guidelines in order to update them in time for the implementation of the European Electronic Communications Code. The SMP Guidelines foresee that the Commission should amend the Guidelines when appropriate, taking into account the experience of applying the regulatory framework and the jurisprudence of the EU Courts.
To access this consultation, please click here.

EU Company law upgraded: Rules on digital solutions and efficient cross-border operations

DEADLINE: 06/08/2017

The aim of this public consultation is to collect input from stakeholders on problems in company law, gather evidence of such problems and ask their views on possible solutions on how to address the problems at EU level. The consultation is divided into four parts (the reasons to act, the use of online tools throughout the companies' lifecycle, the cross-border mobility of companies, the conflict-of-law rules for companies.
To access this consultation, please click here.

COMING-UP

EU Institutions: Important Dates

15-18 May 2017: European Parliament Plenary Session
15 May 2017: Foreign Affairs Council
16 May 2017: General Affairs Council
17 May 2017: Coreper I
17 May 2017: Coreper II
18-19 May 2017: Foreign Affairs Council
18-19 May 2017: Informal Meeting of Energy Ministers
19 May 2017: Coreper I
21-23 May 2017: Informal Meeting of Agriculture Ministers
22 May 2017: General Affairs Council (Art. 50)
23 May 2017: Economic and Financial Affairs Council
24 May 2017: Coreper I
24 May 2017: Coreper II

Other SME-related events

Geo-blocking in the Digital Single Market

30/05/2017, Brussels

On 30 May, Bruegel will organize a conference to discuss the economic impact of geo-blocking, having as a starting point the Commission's regulatory proposal for lifting geo-blocking restrictions in physical goods and non-copyrighted services. The first session will tackle Geo-blocking in physical goods and non-audio-visual services and then the second one will introduce geo-blocking in audio-visual services.
To find out more about this event, please click here.



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The European Small Business Alliance (ESBA) is a non-party political group, which cares for small business entrepreneurs and the self-employed and represents them through targeted EU advocacy and profiling activities.

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